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Alternative Market Briefing

Carbon hedge fund bounces back in August, +22.24% YTD

Monday, September 29, 2008

From the Opalesque team: With August returns of +4.16% (offshore) and +4.03% (onshore) the Natsource Aeolus II funds have bounced back from a negative July to boost the funds’ returns to +22.24% (offshore) and +17.97% (onshore) YTD.

Natsource Asset Management has approximately $1.4bln in assets under management through several vehicles including the Greenhouse Gas Credit Aggregation Pool, a Carbon Asset Pool, and other private investment vehicles such as the Aeolus Funds which are managed by Michael Intrator, Benjamin Richardson, and Jack Cogen, acquire environmental and renewable energy assets.

A communication to Aeolus investors, which Opalesque was able to secure, revealed the Funds achieved positive returns amidst August’s falling value in the energy commodity sector through its exposures to the Certified Emission Reduction (CER) market.

Natsource’s view for the future of carbon markets In research authored by Paul Vickers and Phil Gillam and released by Natsource in August 2008, the firm looks ahead to the next steps in the evolution of the carbon markets. The ever-changing industry is segmenting into two distinct classes of emissions contracts: large, complex transactions which are primarily driven by joint implementation (JI) projects, and smaller projects which are great in number and require simple contacts and significant levels of standardization.

Looking forward, NatSource expects the US l......................

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